Well, you’ve filed your taxes to the best of your abilities and you thought you did everything correctly, but now you’ve gotten that notorious letter in the mail that every Lincoln small business owner wishes they could avoid—you’re being audited by the IRS, and you wonder what you should do next.
Our team of small business tax accounting specialists here at Bryant & Associates, P.C. in Lincoln want to reassure you that this isn’t the end of the world! In this article, we’ll give you some helpful guidance for how to handle the auditing process and come out ready to focus on the future of your growing small business.
First Thing’s First, Get Organized During the Audit
Your overall goal in an audit should be to convince the IRS that the income you’ve stated on your returns is accurate and that you’re entitled to all of the credits, exemptions, and deductions that you applied. In order to make a convincing argument to this effect, you have to be organized.
Hopefully you’ve taken care to arrange your financial documents so that they can be easily referenced, but if not, take the opportunity now to organize your Lincoln small business’ finances so that you’ll have solid answers to an auditor’s questions. If you find that you’re missing receipts or other important financial documents, you will be allowed to reconstruct those records.
Some Audit Do’s and Don’ts
Aside from getting organized, it’s also helpful to enter the auditing process without any misconceptions. This can be difficult, especially if you’ve never been audited before—you’re most likely nervous, and that can lead you to making some big mistakes if you’re not careful.
First off, don’t go into an audit thinking that you have no control. You can and should request more time when you need it for any reason, whether it’s to compile documents or you simply need to gather your thoughts and create a strategy. You can also choose the location of the audit, and we at Bryant & Associates recommend not holding it at your home or place of business. Instead, go to the IRS to have the audit completed or let a tax professional like Bryant and Associates handle it.
You are not required to divulge information that is not specifically asked for during an audit, so don’t feel obligated to give more information than is necessary.
Finally, don’t expect to come out of the audit process owing nothing, as the odds are against this outcome.
Contact Bryant & Associates Today at (402) 423-0404
Our Certified Pubic Accountants (CPA’s) and tax experts here at Bryant & Associates in Lincoln hope that these tips will help you navigate the tricky process of an IRS audit successfully and get you back to focusing on your small business. If you’ve found yourself in the middle of a tax audit and in need of professional help, contact our team today at (402) 423-0404 or fill out our online contact form. We’d be happy to discuss your options and put our expertise to work for you.